Kerkasha Exploration License – Eritrea

Ownership 100% Alpha. Area = 771km² with Four (4) areas of Colonial (Italian) workings identified. Six (6) Artisanal gold mining Prospects identified.

Orogenic gold discovery at Aburna:
- 16m @ 14.07 g/t Au ( 14-30m, ABR037, Northeast Sub Area)
- 20m @ 7.70 g/t Au ( 89-109m, ABD001, Hill 52 Sub Area)
- 18m @ 5.47 g/t Au ( 50-68m, ABR018. Hill 52 Sub Area)
- 15m @ 5.85 g/t Au ( 6-21m, ABR005, Hill 52 Sub Area)
- 10m @ 5.24 g/t Au ( 49-59m, ABR008, Celebration Hill Sub Area)
- 6m @ 6.11 g/t Au ( 66-72m, ABD001, Hill 52 Sub Area)
- 24m @ 1.43 g/t Au (101-125m, ABR034, Central Sub Area)
- 20m @ 1.69 g/t Au (129-149m, ABR027, Celebration Hill Sub Area)
Porphyry copper-gold discovery at Anagulu:
- 108m @ 1.24 g/t Au & 0.60% Cu & 3.57g/t Ag (60 – 168m, AND001)

= 2.19 g/t Au equivalent & 1.39 Cu equivalent

Including 49m @ 2.42 g/t Au & 1.10% Cu & 6.83g/t Ag (80 – 129m, AND001)

= 4.15 g/t Au Equivalent & 2.64 Cu equivalent

109m @ 0.79 g/t Au & 0.35% Cu & 2.21g/t Ag (99-208m, AND005)

= 1.34 g/t Au equivalent & 0.85 Cu equivalent

Including 27m @ 2.67 g/t Au & 0.89% Cu & 6.64g/t Ag (121-148m, AND005)

= 4.07 g/t Au equivalent & 2.59 Cu equivalent

Volcanogenic Massive Sulphide (VMS) discovery at Tolegimja:
- 26m @ 0.11 g/t Au, 0.38% Cu and 1.67% Zn (62-88m, TLR009)
- 18m @ 0.16 g/t Au, 0.34% Cu and 0.99% Zn (41-59m, TLR003)
Significant, high quality datasets available from exploration programmes carried out by AngloGold-Ashanti and Alpha Exploration that has generated Target Areas from traditional prospecting through to ‘cutting edge’ Machine Learning, probabilistic modelling and geochemical data analysis that remain untested by drilling.

The Kerkasha Exploration License Agreement granted on the 10 January 2018, currently covers an area of 771km² and is valid for 5 years with the ability to extend the life on an annual basis. The license area has the potential for gold & base metal mineralisation.

There is the ability to negotiate time extensions for the license after the initial 3 year period.
On the 13th September 2018, Alpha was granted an Extension Area (55km²) in the northeast of the original Kerkasha Licence that increased the area of the Kerkasha License to 1,028km².

Exploration Targets:

– (Sukari Type) Bulk tonnage low grade gold deposit at margin of syn-tectonic intrusion.
– (Zara Type) High grade, deep vein orogenic gold deposit.
– (Augaro Type) Structurally controlled gold-copper deposit.
– (Bisha Type) Volcanogenic massive sulphide (VMS) copper-zinc-gold deposit.
– (Jebel Ohier Type) Porphyry copper-gold deposit.

Historic Exploration & Mining of Kerkasha License Area

COLONIAL PERIOD & ARTISANAL MINING

During the period of Italian Colonial rule in Eritrea from 1890 until the end of the Second World War, there was a sustained programme of exploration and mining of orogenic gold deposits within the country. The Kerkasha Exploration License has four (4) documented Italian Gold Mines (Asheshi, Fankop, Aburna and Abbi) and seven (7) areas of recent Artisanal Mining (Kosolda, Ebinte, Balak, Gulul, Shakat, Dase and Dekemhare) within the License area.

EXPLORATION OF KERKASHA BY ANGLOGOLD-ASHANTI (2010 - 2013)

Fortunately, the work carried out by Anglo Gold Ashanti on behalf of the Thani-Ashanti Alliance is of high quality and has presented Alpha with a sound and extensive dataset that would take significant time and money to develop. This has allowed for a sophisticated ‘Machine Learning’ and ‘Probabilistic Modelling’ regional appraisal of the entire License Area and an early focus on Prospect scale exploration and drilling. Anglo Gold Ashanti carried out the following work programmes:

Remote sensing studies.
Regional geological mapping.
A heli-borne combined Versatile Time Domain Electromagnetic (VTEM)/Radiometric/Magnetic survey over the entire License Area.
Regional stream sediment sampling programme (640 samples) with Bulk Leach Extractable Gold (BLEG) analysis for a sub set of samples (28 samples).
Regional and Prospect scale rock chip sampling (184 samples).
Prospect scale geological mapping over the six most promising areas for orogenic gold mineralisation (Kosolda, Asoshi, Balak, Shakat, Gulul and Aborita/Dase Prospects).

The main emphasis of the Anglo Gold Ashanti exploration was for orogenic gold. The search for volcanogenic massive sulphides (VMS) within the volcanic belts was not pursued to the same extent.
The Thani-Ashanti Alliance relinquished the property for corporate reasons, not geological reasons. The AngloGold Ashanti group dramatically reduced their worldwide exploration effort during 2013 and the relinquishment of Kerkasha was part of this restructuring.

KERKASHA LICENSE

Ownership 100% Alpha.
Area = 771km².
Four (4) areas of Colonial (Italian) workings identified.
Six (6) Artisanal gold mining Prospects currently identified.
Ten (10) new Prospect Areas identified by Alpha exploration (including the Aburna orogenic gold discovery, Anagulu porphyry copper-gold discovery and the Tolegimja VMS discovery).
Located in highly prospective Nakfa Terrain rocks (hosts Bisha, Hambok and Zara deposits).
On Augaro -Kerkasha ‘gold trend’.
Significant, high quality dataset available from exploration programmes carried out by Anglo Gold Ashanti
Alpha Exploration has generated new Target Areas from traditional prospecting through to ‘cutting edge’ Machine Learning, Probabilistic modelling and geochemical data analysis (Centre Log Ratio &Z Score Normalisation) that remain untested by drilling.

ANAGULU DISCOVERY

Virgin Au-Cu discovery by Alpha Exploration at Anagulu Prospect.
Coincident soil & rock chip anomalies for Au & Cu at surface over 2kms long (strike 45°).
Coincident chargeability-resistivity-gravity anomalies up to 3.5kms long (strike 45°).
2km long chargeability anomaly coincident with 2km soil & rock chip Au-Cu anomalies.
Drill Results (High Grade):
- AND001: 52m @ 2.33 g/t Au & 1.05% Cu & 6.53g/t Ag ( 80-132m)
  - Discovery Hole January 2020 – (Au Equivalent of 3.39g/t on 26 May 2020)
- AND005: 27m @ 2.67 g/t Au & 0.89% Cu & 6.64g/t Ag (121-148m)
- ANR016: 7m @ 12.39 g/t Au & 0.05% Cu & 0.51g/t Ag (151-158m)
Drill Results (Low Grade):
- AND005: 109m @ 0.79 g/t Au & 0.35% Cu & 2.21g/t Ag ( 99-208m)
- ANRO17: 81m @ 0.54 g/t Au & 0.28% Cu & 1.37g/t Ag ( 9-90m )
- ANR029: 70m @ 0.56 g/t Au & 0.37% Cu & 1.71g/t Ag ( 48-118m)
- AND008 118m @ 0.21 g/t Au & 0.13% Cu (225-343m)
- ANR015: 42m @ 0.29 g/t Au & 0.18% Cu & 0.78g/t Ag ( 94-136m)
- AND003: 70m @ 0.14 g/t Au & 0.12% Cu & 0.56g/t Ag (173-243m)

ABURNA OROGENIC GOLD PROSPECT

Located in the southwest of the Kerkasha Project – 7kms due north of the Anagulu Prospect.

Location of Aburna and Anagulu Prospects in the southwest of the Kerkasha Project Area.

The Aburna Prospect is bound by two generally north-south structures and has the same northeast orientation for mineralisation to the Anagulu Prospect.

Significant Au results from soil, rock chip, channel and trench sampling are located over a 6 x 2 km northeast trend (zone of interest) in mafic volcanics, sediments and a granodiorite. Five sub areas (Northeast, Central, Hill 52, Celebration Hill and Saddle Workings) were identified for drill testing.

100m x 100m soil sampling at Aburna Prospect with the Colonial Gold Mine & Sub Areas where drilling has occurred (red ellipsoids)

Channel sampling undertaken from Apr – Sept 2021 in prospective areas:

55 channels were cleared of colluvium
1,578 rock-chip samples collected at 1m intervals
Positive assays for gold returned from 4 areas.

Trench sampling undertaken to verify channel results:

49 trenches (1-2m deep) were completed.
2,985 Samples were collected at 1m intervals.
Positive assays for gold returned from 4 areas

Significant Trench & Channel sample assay results

45m @ 3.75 g/t gold (Trench 22 – Hill 52 Area)
11m @ 6.55 g/t gold (Trench 25 – Hill 52 Area)
51m @ 2.14 g/t gold (Channel 51 – Hill 52 Area)
8m @ 9.65 g/t gold (Channel 52 – Hill 52 Area)
1m @ 244.00 g/t gold (Trench 40 – Aburna Central Area)
3m @ 17.31 g/t gold (Trench 41 – Aburna Central Area)
10m @ 3.28 g/t gold (Trench 3 – Northeast Area
25m @ 3.71 g/t gold (Channel 12 – Northeast Area)
9m @ 4.01 g/t gold (Channel 45 – Northeast Area)
14m @ 2.84 g/t gold (Trench 4 – Celebration Hill Area)
50m @ 3.81 g/t gold (Channel 16 – Celebration Hill Area)
14m @ 1.58 g/t gold (Channel 54 – Celebration Hill Area)

Drilling

A total of 43 drill holes in 5 sub areas have been completed at Aburna Prospect as follows:
- 38 Reverse Circulation (RC) holes for a total of 4,315m
- 5 Diamond Drill (DD) holes for a total of 881.1m

Significant Drill Intercepts to date

Hill 52 drill location plan with gold mineralised intercepts projected to surface

Interpretation of high-grade gold mineralisation on section B-B with ABD001, ABR005 & ABR018 – Hill 52 Sub Area

ANAGULU PORPHYRY COPPER-GOLD DISCOVERY

Located in the southwest of the Kerkasha Project – 7kms due south of the Aburna Prospect.

Virgin discovery by Alpha Exploration at Anagulu Prospect.
Anagulu is interpreted as a gold-copper porphyry mineralisation by Consultant Geologist Dr Richard Sillitoe.
Coincident soil & rock chip anomalies for Au & Cu at surface over 2kms long (strike 45°).

Tolegimja soil and rock chip geochemistry for gold and copper

Drill holes completed to date at Anagulu:

42 Reverse Circulation (RC) holes for a total of 6,246m
9 Diamond Drill (DD) holes for a total of 3,684.5m
4 RC holes with DD tails for a total of 1,156.15m

Significant Drill Intercepts to date for Au-Cu-Ag + Au & Cu Equivalents

The following methodology and calculations were used to determine the drill hole intercepts
- Intercept calculations for RC holes ANR015-030 and DD holes AND001-009 are made using following parameters:
- The interval must start and finish with a value >500ppm Cu
- There must be no interval more than 2m within the intercept that is less than 500ppm Cu
- For RC Holes ANR031 – 044 and RC+DD ‘tails’ ANRD031, 032, 035, 040 the true width of the mineralisation is uncertain, but the host structures are interpreted to be steeply dipping implying true widths are in the range of 60–80%. Intervals are based on a 0.1 g/t Au cut off and a maximum internal dilution of 2 m.

The following methodology and calculations were used to determine the AuEq & CuEq calculations given
- AuEq = ((Cu%) x $Cu x 22.0642) + (Au(g/t) x $Au x 0.032151)) / ($Au x 0.032151); minor Ag grades not included.
- CuEq = ((Cu%) x $Cu x 22.0642) + (Au(g/t) x $Au x 0.032151)) / ($Cu x 22.0642); minor Ag grades not included.
  - Commodity prices: $Cu = US$4.00/lb (= US$8,818/tonne) and $Au = US$1,750/oz.
  - Factors: 22.0642 = Cu% to lbs per tonne, and 0.032151 = Au g/t to oz per tonne.
  - Metallurgical recovery for Cu and Au is assumed to be 100%

After examination of Anagulu core, Dr Richard Sillitoe (Consultant) advised remapping of Prospect identifying the ‘quartz eye’ diorite

The geological map for Anagulu (adjacent diagrams) – the quartz eye diorite (light green) extends and expands for ~1.5kms to the southwest of the current zone of intense drilling (red polygon) .

This extensive zone of quartz eye diorite was sampled with trenching over the entire 1.5kms and has returned anomalous copper (see adjacent diagrams).

This area is a target for further drilling. It has the potential to increase the known mineralisation at Anagulu.

TOLEGIMJA VOLCANOGENIC MASSIVE SULPHIDE PROSPECT

Located in the northeast of the Kerkasha Project

Tolegimja is interpreted as a bimodal-mafic Volcanogenic Massive Sulphide (VMS) setting.
Best surface copper values between felsic and mafic volcanics where gossans occur.
Strong coincidence of best copper values at surface with strong chargeability (IP) anomalies.

Tolegimja geology & IP with drill holes, section lines & interpreted VMS trend

Drilling

1,862m (9 Drill Holes) of RC drilling completed in Q1 2022
Tolegimja discovery holes
- 26m @ 0.11 g/t Au, 0.38% Cu, 1.67% Zn (62 – 88m, TLR-009)
- 18m @ 0.16 g/t Au, 0.34% Cu, 0.99% Zn (41 – 59m, TLR-003)

Tolegimja drill section B-B with zinc mineralised intercept summarised

Tolegimja drill section A-A with zinc mineralised intercepts summarised

NEXT STEPS IN EXPLORATION

ABURNA:

Further soil, channel and trenching sampling to help focus further drilling (Q4 2022).
Ground Induced Polarization & magnetic survey (Q1 2023).
Further drilling at Hill 52, Celebration Hill, Central and Northeast Areas (Q1 2023).
Develop an inferred gold resource (Q4 2023)

ANAGULU:

Drill testing of anomalous zones from trenching & mapping (Q2 2023).
Follow up drilling if the drilling in Q2 2023 is positive (Q4 2023)

TOLEGIMJA:

Drill test strike extensions to massive sulphide in TLR003 & TLR009 (Q1 2023).
Drill test southwest area that has an IP anomaly & gossans like the area with TLR003 & TLR009 (Q1 2023).

REGIONAL EXPLORATION:

Follow up on new Target Areas identified from Dr Michael Gazley’s updated evaluation of regional and Prospect scale surface geochemical datasets.

EXPANSION WITHIN THE ARABIAN-NUBIAN SHIELD:

Acquire a second License in Eritrea – application already submitted
Investigate acquiring an Exploration License in Saudi Arabia and/or Sudan

Kerkasha Project Photos

PROJECTS